1 00:00:02,440 --> 00:00:10,240 Speaker 1: Bloomberg Audio Studios, Podcasts, radio news. I'm Stephen Carol and 2 00:00:10,360 --> 00:00:12,880 Speaker 1: this is Here's Why, where we take one news story 3 00:00:12,920 --> 00:00:14,880 Speaker 1: and explain it in just a few minutes with our 4 00:00:14,920 --> 00:00:21,280 Speaker 1: experts here at Bloomberg. Since the Hamas attack on Israel 5 00:00:21,320 --> 00:00:23,640 Speaker 1: on the seventh of October and the war in Gaza 6 00:00:23,680 --> 00:00:27,040 Speaker 1: that's followed, tensions in the Middle East have been running high, 7 00:00:27,120 --> 00:00:28,840 Speaker 1: with little sign of improvement. 8 00:00:29,360 --> 00:00:33,360 Speaker 2: Israel is threatening further military action after striking Hasbella targets 9 00:00:33,360 --> 00:00:36,080 Speaker 2: in Lebanon in response to a rocket attack that killed 10 00:00:36,120 --> 00:00:39,920 Speaker 2: a dozen young people in the Israeli occupied Golan Heights. 11 00:00:40,000 --> 00:00:44,640 Speaker 1: Hamas says Israel killed its political leader Ismail Hania in 12 00:00:44,720 --> 00:00:48,320 Speaker 1: an airstrike on Tehran. The recent headlines have been dominated 13 00:00:48,360 --> 00:00:52,800 Speaker 1: by repeated attacks, assassinations, and fears of a wider regional war, 14 00:00:53,600 --> 00:00:57,160 Speaker 1: but in the background, there's also been talking negotiations over 15 00:00:57,200 --> 00:01:00,040 Speaker 1: a truce in Gaza and attempts to de escalate the 16 00:01:00,080 --> 00:01:03,920 Speaker 1: conflict between Israel, Iran and the Hamas and Hezbala groups, 17 00:01:03,960 --> 00:01:08,160 Speaker 1: which are backed by Tehran. So Here's why diplomacy still 18 00:01:08,240 --> 00:01:13,880 Speaker 1: matters in the Middle East. Our head of Middle East 19 00:01:13,880 --> 00:01:17,839 Speaker 1: and North Africa coverage, Stuart Livingston Wallas joins me. Now, Stewart, 20 00:01:17,920 --> 00:01:21,160 Speaker 1: there's been so much violence over the past few months, 21 00:01:21,319 --> 00:01:23,080 Speaker 1: what are diplomats doing about it? 22 00:01:23,640 --> 00:01:27,160 Speaker 3: So it's basically been an escalation, I would say, certainly 23 00:01:27,200 --> 00:01:29,800 Speaker 3: on the military fund, but particularly on the diplomatic front. Now, 24 00:01:29,800 --> 00:01:32,840 Speaker 3: it's also true to say that diplomacy has a thread 25 00:01:32,880 --> 00:01:35,880 Speaker 3: that's been running pretty consistently in the region, but particularly 26 00:01:35,880 --> 00:01:38,240 Speaker 3: since this all sort of started on this latest phase 27 00:01:38,240 --> 00:01:41,680 Speaker 3: start in October. But really we've had these two assassinations, 28 00:01:41,720 --> 00:01:44,039 Speaker 3: one in Beirut of the Hesbala leader and one of 29 00:01:44,080 --> 00:01:46,120 Speaker 3: her Nie, who was one of the Hamas or the 30 00:01:46,120 --> 00:01:50,200 Speaker 3: Hamasis political leader in Tehran, and I think the feeling 31 00:01:50,560 --> 00:01:54,920 Speaker 3: was that Iran would have to retaliate in some fashion, 32 00:01:55,040 --> 00:01:59,320 Speaker 3: and because it was so deeply embarrassing for someone of 33 00:01:59,360 --> 00:02:02,800 Speaker 3: her nearest in Tehran who had been invited to the 34 00:02:02,840 --> 00:02:07,200 Speaker 3: inauguration of the Iranian president basically gets assassinated under their noses, 35 00:02:07,320 --> 00:02:09,400 Speaker 3: So it's not a great look for them. And I 36 00:02:09,400 --> 00:02:12,519 Speaker 3: think the fear was that Iran would have to respond, 37 00:02:12,680 --> 00:02:15,000 Speaker 3: or felt it would have to respond far more aggressively 38 00:02:15,440 --> 00:02:18,160 Speaker 3: than it did in April. So April, the April incident 39 00:02:18,200 --> 00:02:20,040 Speaker 3: was the one where it sent something in the order 40 00:02:20,120 --> 00:02:23,760 Speaker 3: three three hundred and fifty drones that missiles directly at 41 00:02:23,800 --> 00:02:27,640 Speaker 3: Israel and now they were successfully intercepted, almost without exception. 42 00:02:28,560 --> 00:02:31,840 Speaker 3: But the real worry was that if they did something 43 00:02:32,160 --> 00:02:35,600 Speaker 3: even bigger than that, however well calibrated they thought it 44 00:02:35,639 --> 00:02:38,639 Speaker 3: would be, so you had an exponential increase in the 45 00:02:38,720 --> 00:02:41,440 Speaker 3: risk that it would hit a target or hit a 46 00:02:41,480 --> 00:02:45,080 Speaker 3: population that was perhaps not intended, but would in turn 47 00:02:45,160 --> 00:02:49,040 Speaker 3: force Israel to respond on an even grander scale. So 48 00:02:49,120 --> 00:02:51,680 Speaker 3: you've seen lots of leaders come in there. You have 49 00:02:52,120 --> 00:02:54,040 Speaker 3: the usual actors that you've seen in the last several 50 00:02:54,080 --> 00:02:56,880 Speaker 3: months of people like Anthony Blinkholm. But I think more 51 00:02:56,880 --> 00:03:01,440 Speaker 3: importantly you have Russia that has sent its former army 52 00:03:01,520 --> 00:03:05,639 Speaker 3: chief Gantataey Iran for discussions. You have the French president 53 00:03:05,880 --> 00:03:10,160 Speaker 3: again contacting Iran directly, and I think the messaging around 54 00:03:10,160 --> 00:03:12,840 Speaker 3: this is very clear, Please do not escalate. There is 55 00:03:12,880 --> 00:03:16,760 Speaker 3: nothing to be gained from escalation. And what's interesting is that, 56 00:03:16,800 --> 00:03:18,760 Speaker 3: at least so far, it seems. 57 00:03:18,480 --> 00:03:23,400 Speaker 1: To be working quite about progress towards a broader ceasefire 58 00:03:23,639 --> 00:03:28,040 Speaker 1: or truce in Gaza. What sort of progress has been 59 00:03:28,080 --> 00:03:30,000 Speaker 1: made in those discussions. 60 00:03:29,760 --> 00:03:32,440 Speaker 3: I think there were worries that when Hernia, that is 61 00:03:32,480 --> 00:03:36,720 Speaker 3: that her mass's political leader was assassinated, they gave that 62 00:03:36,960 --> 00:03:40,960 Speaker 3: job to basically the leader in Gaza, sinwall and Sinhwar 63 00:03:41,160 --> 00:03:42,720 Speaker 3: is sort of the hard liner on this, I mean, 64 00:03:42,720 --> 00:03:44,200 Speaker 3: the kind of all our hard lines, but he is 65 00:03:44,200 --> 00:03:46,400 Speaker 3: a particular hardliner. He's also perceived as one of the 66 00:03:46,440 --> 00:03:50,320 Speaker 3: masterminds of the October seventh attack on Israel from Gaza. 67 00:03:50,720 --> 00:03:53,240 Speaker 3: The reality is that he was probably making most of 68 00:03:53,280 --> 00:03:56,400 Speaker 3: the final decisions on the ceasefire negotiations in any case, 69 00:03:56,840 --> 00:04:00,080 Speaker 3: So I think our big takeaway from this is that, hey, 70 00:04:00,280 --> 00:04:02,960 Speaker 3: it clearly was her Mass trying to send a message 71 00:04:03,000 --> 00:04:05,280 Speaker 3: to the wider world of what their intention was, but 72 00:04:05,360 --> 00:04:07,920 Speaker 3: at the same time, it probably didn't change the ultimate 73 00:04:08,000 --> 00:04:11,960 Speaker 3: decision maker. I think the feeling within certainly diplomatic circles 74 00:04:11,960 --> 00:04:14,480 Speaker 3: trying to de escalate the situation is that you have 75 00:04:14,600 --> 00:04:17,800 Speaker 3: to have some sort of resolution in Gaza before you 76 00:04:17,839 --> 00:04:20,360 Speaker 3: can hope to make progress on any of the other 77 00:04:20,520 --> 00:04:24,800 Speaker 3: multiple conflicts now, particularly Lebanon. That is one that continues 78 00:04:24,839 --> 00:04:28,680 Speaker 3: to worry us, particularly at Yemen Gaza, and what's happened 79 00:04:28,680 --> 00:04:32,680 Speaker 3: in Gaza since October has really been the foundation for 80 00:04:32,760 --> 00:04:35,359 Speaker 3: a lot of the rhetorica around why these groups, and 81 00:04:35,400 --> 00:04:38,520 Speaker 3: they are for the most part Iranian fact are unleashing 82 00:04:38,560 --> 00:04:41,279 Speaker 3: these assaults on the wide region. And I remind everyone 83 00:04:41,360 --> 00:04:45,000 Speaker 3: it's not just Israel that they're attacking. There is this 84 00:04:45,120 --> 00:04:49,200 Speaker 3: ongoing series of attacks on commercial shipping moving through the 85 00:04:49,240 --> 00:04:51,000 Speaker 3: Red Sea, the Gulf of Hermad and so on, and 86 00:04:51,040 --> 00:04:55,160 Speaker 3: that really has had a global impact. Has progress been made, 87 00:04:55,279 --> 00:04:59,240 Speaker 3: I mean, we hear repeatedly from particularly the US administration 88 00:04:59,320 --> 00:05:02,320 Speaker 3: that they're getting cl There's no reason to disbelieve that. 89 00:05:02,400 --> 00:05:05,880 Speaker 3: But again, there is a fundamental block here, which is 90 00:05:05,920 --> 00:05:08,320 Speaker 3: that Israel has said that it must or its intention 91 00:05:08,560 --> 00:05:11,480 Speaker 3: is that it must destroy the her Mass leadership and 92 00:05:11,600 --> 00:05:14,479 Speaker 3: ensure that her Mask can never again have any sort 93 00:05:14,480 --> 00:05:17,520 Speaker 3: of sway in Gaza before it's prepared to accept some 94 00:05:17,560 --> 00:05:21,039 Speaker 3: sort of peace. Obviously, its counterparty with its negotiations is 95 00:05:21,040 --> 00:05:24,080 Speaker 3: her Mass that is very unlikely ever to agree to that. 96 00:05:24,120 --> 00:05:26,760 Speaker 3: So whether they can find some sort of path to 97 00:05:26,880 --> 00:05:29,640 Speaker 3: some sort of peace remains to be seen. 98 00:05:30,440 --> 00:05:33,240 Speaker 1: The top US Depromt Anthony Blinken, Secuty Estate, has made 99 00:05:33,240 --> 00:05:37,520 Speaker 1: many visits to the Middle East since last October. How 100 00:05:37,600 --> 00:05:40,680 Speaker 1: important is US influence in this region. 101 00:05:41,320 --> 00:05:43,920 Speaker 3: Extremely because the short answer, I mean it's waxed and 102 00:05:43,960 --> 00:05:46,520 Speaker 3: waned over the years. So it looked fairly clear a 103 00:05:46,520 --> 00:05:49,760 Speaker 3: couple of administrations and goes, probably starting with Obama but 104 00:05:49,760 --> 00:05:53,120 Speaker 3: then certainly into Trump, that the US appetite for sort 105 00:05:53,160 --> 00:05:56,480 Speaker 3: of mass deployments in the Middle East was very much diminishing. Now, 106 00:05:56,600 --> 00:05:58,680 Speaker 3: in part that was a function of the fact of 107 00:05:58,760 --> 00:06:01,479 Speaker 3: the rise of China, and there were obviously going to 108 00:06:01,520 --> 00:06:04,640 Speaker 3: be increasing pressure over the next several years in the 109 00:06:04,640 --> 00:06:10,159 Speaker 3: Western Pacific, and enormous though US military power is, it 110 00:06:10,160 --> 00:06:12,960 Speaker 3: couldn't necessarily deploy on the scale it needed to, both 111 00:06:13,000 --> 00:06:15,360 Speaker 3: in the Middle East and in the Pacific as well 112 00:06:15,360 --> 00:06:18,120 Speaker 3: as many other places. And so you saw this move 113 00:06:18,440 --> 00:06:20,599 Speaker 3: out of the region. I would say it's somewhat by 114 00:06:20,640 --> 00:06:23,200 Speaker 3: the US. You had the Abraham the Calls, which are 115 00:06:23,240 --> 00:06:25,240 Speaker 3: the sort of piece deals between some of the Arab 116 00:06:25,360 --> 00:06:28,000 Speaker 3: nations and Israel, and in some respects that was the 117 00:06:28,120 --> 00:06:30,920 Speaker 3: US trying to find some sort of balance of power 118 00:06:30,960 --> 00:06:34,520 Speaker 3: in a scenario where the US would remain present, perhaps 119 00:06:34,520 --> 00:06:36,560 Speaker 3: not on the scale that people have got used in 120 00:06:36,640 --> 00:06:41,479 Speaker 3: previous years. Now, clearly that's been derailed pretty dramatically by 121 00:06:41,520 --> 00:06:43,960 Speaker 3: what's been happening in Gaza and elsewhere in the region, 122 00:06:44,400 --> 00:06:47,200 Speaker 3: and so the US has had to effectively move back 123 00:06:47,240 --> 00:06:50,040 Speaker 3: into the region. It's sent in a carrier strike group, 124 00:06:50,040 --> 00:06:53,039 Speaker 3: it's sending in squadron of fighter jets, it's having to 125 00:06:53,040 --> 00:06:56,680 Speaker 3: send in additional destroyers. So in some respects it's had 126 00:06:56,720 --> 00:06:58,840 Speaker 3: to u turn as a function of the fact that 127 00:06:58,880 --> 00:07:01,400 Speaker 3: this threat is now spread right across the region. 128 00:07:01,839 --> 00:07:05,800 Speaker 1: Who are the other key actors in the diplomatic efforts, Well, 129 00:07:05,800 --> 00:07:06,160 Speaker 1: the other. 130 00:07:06,080 --> 00:07:09,440 Speaker 3: One we haven't mentioned to date, and who is a very, 131 00:07:09,520 --> 00:07:11,880 Speaker 3: very weighty actor in all of this is Katar, and 132 00:07:11,960 --> 00:07:14,400 Speaker 3: Katar is often the one that gets forgotten about. I mean, 133 00:07:14,480 --> 00:07:16,320 Speaker 3: just to set the scene for people, this is a 134 00:07:16,520 --> 00:07:19,000 Speaker 3: relatively small sliver of land that juts out into the 135 00:07:19,000 --> 00:07:21,120 Speaker 3: Persian Gulf. But by the end of this decade, they're 136 00:07:21,120 --> 00:07:23,080 Speaker 3: going to be controlling something like a quarter of the 137 00:07:23,080 --> 00:07:26,600 Speaker 3: world's liquefied natural gas supply. Now, with all this money 138 00:07:26,600 --> 00:07:29,400 Speaker 3: that has come in in the last I suppose twenty 139 00:07:29,440 --> 00:07:33,160 Speaker 3: five thirty years, they are building out on several fronts. 140 00:07:33,160 --> 00:07:35,880 Speaker 3: So the one I suspect everyone is aware of is 141 00:07:36,040 --> 00:07:40,120 Speaker 3: obviously hosting the World Cup, but they've obviously been buying companies. 142 00:07:40,120 --> 00:07:42,800 Speaker 3: They've been buying real estate or around the place. But 143 00:07:42,880 --> 00:07:45,360 Speaker 3: the other key thing that they're doing is becoming effectively 144 00:07:45,400 --> 00:07:48,920 Speaker 3: one of the major negotiators and mediators in the region. 145 00:07:48,960 --> 00:07:51,040 Speaker 3: So they've been involved in all sorts of things, everything 146 00:07:51,160 --> 00:07:55,160 Speaker 3: from hosting the Taliban to hosting her Mass and that 147 00:07:55,240 --> 00:07:57,840 Speaker 3: obviously was done in coordination with the US. They host 148 00:07:57,960 --> 00:08:02,760 Speaker 3: a gigantic US base, hosts a very substantial Turkish space, 149 00:08:03,240 --> 00:08:06,520 Speaker 3: and they're really kind of the mediators between lots and 150 00:08:06,520 --> 00:08:09,280 Speaker 3: lots of warring parties all over the world. Now they're 151 00:08:09,360 --> 00:08:11,880 Speaker 3: key in this one because they were, or they have 152 00:08:12,000 --> 00:08:14,800 Speaker 3: been and continue to be one of the really strong 153 00:08:14,840 --> 00:08:18,320 Speaker 3: players in these ceasfile negotiations. They were certainly one of 154 00:08:18,320 --> 00:08:21,160 Speaker 3: the mediators involved in the rather short lived seas far 155 00:08:21,240 --> 00:08:22,880 Speaker 3: that we saw several months ago that led to the 156 00:08:22,920 --> 00:08:26,080 Speaker 3: release of some hostage and a temporary cessation of hostilities 157 00:08:26,200 --> 00:08:28,400 Speaker 3: in Gaza, and they continue to do so. 158 00:08:28,680 --> 00:08:31,320 Speaker 1: Okay, Stuart Livingston Wallace, our head of Middle East and 159 00:08:31,440 --> 00:08:35,319 Speaker 1: North Africa coverage at Bloomberg, thank you for more explanations 160 00:08:35,400 --> 00:08:37,960 Speaker 1: like this from our team of twenty seven hundred journalists 161 00:08:38,000 --> 00:08:40,440 Speaker 1: and analysts around the world. Search for quick take on 162 00:08:40,480 --> 00:08:45,439 Speaker 1: the Bloomberg website or Bloomberg Business App. I'm Stephen Carol. 163 00:08:45,640 --> 00:08:48,240 Speaker 1: This is here's why. I'll be back next week with more. 164 00:08:48,480 --> 00:08:49,319 Speaker 1: Thanks for listening.